Chairman’s Report – June 14, 2019

Why Don’t Business Leaders Demand The FAIRtax?

A question often asked at public meetings while discussing The FAIRtax is, “Why doesn’t business support The FAIRtax?”  Of course, many business owners support The FAIRtax and they are advocates.

Logically, there are many reasons why businesses should support The FAIRtax.
  • Eliminates the need to collect and remit income/payroll taxes from employees;
  • Eliminates the need to spend countless dollars just doing the accounting and paying for tax advice;
  • Eliminates the required increases in the prices of final products because of the need for each supplier who contributes to the final product to increase their prices to offset the costs of the income/payroll tax system;
  • Eliminates the advantages given to imports competing against U.S. products;
  • Eliminates the burden of the U.S. income/payroll tax which must be included when U.S. products are exported and makes U.S. products more competitive;
  • Eliminates the uncertainty plaguing U.S. business not knowing what the tax policy will be in future years;
  • Eliminates the factors inhibiting the growth of the U.S. economy and will lead to more profits and more markets for business.

The Elite Tax Professional Influence

As a person who for years made a very good income from advising people how to pay less taxes, I understand why many people who work in the tax preparation industry are happy with the income tax.  The present income/payroll tax system provides them with a substantial income and it also is a fun game to many tax professionals.  They spend their time getting paid to solve problems for people who will pay them large amounts of money and hang on to their every word as they advise their clients how to pay less in taxes.
I am not referring to the people who work for the tax preparation firms and mostly deal with families earning under $100,000 per year.  These elite professionals charge as much as $1,200/hour and work for the wealthy taxpayers who can justify paying many thousands of dollars for advice.
Chetan Vagholkar is a partner in the International Tax practice of KPMG LLP and is based in the firm’s Houston office.  He wrote an article entitled, “Tax Reform – An Opportunity For Tax Professionals”, published 6/5/19 in the Houston Chronicle.  In his article, Mr. Vagholkar stated:
  • The greatest change was corporate tax rates lowered to a flat 21% on all income.
  • Tax reform also gave additional benefits (in the form of an additional deduction) for certain small business-oriented companies.
  • The tax code was complicated before tax reform and has become exponentially more complicated since.
  • Regulations and guidance were slow to be issued.  Now, in the past few months, we have seen over 1,000 pages of guidance come through from the government.
  • This is an exciting time for our industry.  As tax professionals, we have an exceptional, once-in-a-career opportunity to be part of a major restructuring of the U.S. tax code.

Mr. Vagholkar is excited about the great career opportunity provided by the recent income/payroll “reform”.  While I don’t know Mr. Vagholkar, I am confident he, like many of the tax professionals with whom I have worked, are not only decent people but also are very intelligent.
They see their activities as necessary to the survival of their clients and, because of the income/payroll tax system, they are correct.  If a business can reduce its tax burden by 15% this is a reduction in costs which, after deducting the cost of the advice, can increase profits.
Of course, when The FAIRtax replaces the income/payroll tax system, the need to pay for this type of tax advice is eliminated and the company can re-direct its resources to producing better products and being a better business.  In addition, the company will have another benefit—the knowledge what they do today will not be wrecked by Congress tomorrow, nullifying all of their hard work and projections.
For example, many business decisions have to consider the economic impact on the business and how the decision affects the amount of income tax it will pay.  Every day, businesses decide to invest in a particular type of plant expecting the income tax savings will help pay for the costs of the plant.  They are forced to rely on the present income tax law but, as we have repeatedly seen, Congress changes the income tax provisions all the time.
If the change eliminates the income tax benefits of the business decision, the business is stuck.  They still have to pay, but they have fewer income tax savings dollars to use.  The effect is the business is less profitable and less stable.
In surveys of business owners, whether large or small, 1 of the top items they want is predictability of the impact of the income tax.  Impossible!  As history has shown, politicians, lobbyists, and weak short-term thinking, feeds the frenzy to constantly manipulate the income/payroll tax system.
Perhaps the most harmful action of the elite tax professionals is they have assisted businesses interpret the income tax code in a way the owners and decision makers believe they are paying less taxes and they don’t feel the pain the rest of us who cannot afford to pay the elite tax professionals feel and protest.  We all know the bigger businesses in this country can demand Congress and the President to scrap the present system, they have the resources and influence to make it happen.
The elite tax professionals are working with the existing system.  Almost all of them are intelligent and good people who see their role as valuable and essential to their clients.  However, they are essential in their role only as long as we allow the Swamp to impose the yoke of the income/payroll taxes around our necks.
When we put personal interests aside and look at the value to the nation as a whole, everyone will say, “It is time to pass The FAIRtax!”
The author George Bernard Shaw said, "You see things; and you say “Why”.  But I dream things that never were; and I say “Why Not”.
Isn’t it time for us to ask, “Why Not”.  Isn’t it time to take back control from D.C.?
We say to you President Trump, “Embrace The FAIRtax and real tax reform!  Stand up to The Swamp.  They will oppose you anyway because they see you as a threat.  What have you got to lose?”
Let’s Take Back America!  Pass The FAIRtax Now!
The truth is the truth.  Remember, if we don't continue to tell the truth and demand a change, then this quote from George Orwell's 1984 may foretell our children's future: “If you want a picture of the future, imagine a boot stamping on a human face—forever.”
What Can Each Of Us Do?
Call the local or D.C. office of your House Member and 2 Senators and you can use the following script:
  • I am sure Representative ____ or Senator ____ is in favor of everyone obeying the income tax laws.
  • After they assure you their boss is not in favor of anyone breaking the law, ask if they are aware of the Cebula study showing $9 trillion of evaded income/payroll taxes over the next 10 years.
  • Since most will say they don’t believe their boss has seen the study, either drop off a copy or get an email address and send a copy to them for their boss.
  • Say you are going to call back in a week and ask what the Representative or Senator is going to do to stop this evasion.
  • In a week, call back and ask specifically what the Representative or Senator is going to do to enforce the law.
  • They probably will say their boss believes simplifying the income tax will handle the problem.
  • Explain, when people evade income taxes, they are also evading the 15.3% payroll/Medicare tax and state income tax.  So, it is unlikely they are going to pay 30% or 40% when they were paying 0% because they have already decided it is okay to cheat.
  • Say, the only way to reduce evasion is to increase by tens or hundreds of thousands the number of comprehensive IRS audits done each year.
  • Point out Evaders do not self-identify by putting an “E” on their income tax return.
  • 80% of the people likely to be audited are trying to comply, but they will be forced to endure these IRS audits as well.
  • Ask if the Member is in favor of this?
  • If they say no, then ask again how the Member proposes to stop people breaking the income tax laws.
  • Then explain the way to handle evasion without unleashing the IRS audits is The FAIRtax.
  • If you can see your Member or attend a town hall and ask these questions, you can be even more effective.
Online Resources
These links will help you promote and support The FAIRtax.  We always do our best to keep our AFFT community up to date, and you can stay ahead of the curve using these convenient sites.
Americans For Fair Taxation
Americans For Fair Taxation Facebook Page
Americans For Fair Taxation Twitter Page
Americans For Fair Taxation YouTube Channel

Official FAIRtax Logo Store

The FAIRtax Guys
The FAIRtax Guys Facebook Page
The FAIRtax Guys YouTube Channel

PopVox - The People’s Voice On All Things Legislative
Read Evasion Study Summary
FAIRtax Power Radio Podcast & Digital TV Show
#164 - The FAIRtax Guys Q&A With Grad Students - Part 2
A good way to learn more about The FAIRtax is by listening to the questions posed by the grad students at Oklahoma State University and the answers offered by The FAIRtax Guys with occasional help from Jade Walle.  These graduate level CPA students ask some very interesting questions.  Interesting questions result in interesting answers and a better understanding of The FAIRtax for all.
What will corporations do with the cost savings they encounter when The FAIRtax becomes law?  Will The FAIRtax interfere with state level taxing?  Who qualifies for the Prebate? Citizens only or will non-citizen permanent residents be included?
As you can imagine, these students have a great interest in personal and business finances obvious in their questions..  The FAIRtax Guys enjoyed the challenge of thinking through these issues.
But wait, there’s more!  Listen to the podcast or watch the digital TV show to find out.
We have been Live streaming FTPR to Facebook every week for almost a year now.  But now, FAIRtax Power Radio will be Live streamed to YouTube also.  Watch for announcements and then go to our YouTube Channel.  This is a great alternative if you’re not a Facebook user.
If you are a Facebook user, check out our Live stream at Tuesday 8PM ET on Facebook.  Remember, Live stream also means Live comments.  Join the show.
However, if you can’t catch the Live show, just go to FAIRtax Guys to see our latest effort in getting The FAIRtax news spread far and wide.  This new website is open to everyone; no subscription or “joining” is necessary. Just dive right in!
FTPR podcasts for each show are posted on Spreaker, iTunes & iHeart Radio every Friday morning.  Since it’s a podcast, you can download it and play it whenever it’s convenient for you.  A free FAIRtax Power Radio app is available for iOS and Android.
If you believe The FAIRtax is good for America, PLEASE let others know by turning them onto FAIRtax Power Radio - the ONLY weekly FAIRtax digital TV show in the country!  And look for us on our YouTube Channel.  If you can’t watch live or you don’t use Facebook, go to FAIRtax Guys to watch the show and keep up with the latest events.
Please help us educate as many Americans about The FAIRtax as possible.  Be sure to tell everyone you know about this great format for FAIRtax Power Radio.  Whether you watch the weekly TV show or listen to the weekly podcast, this is a great way for more Americans to learn about the best tax reform plan in Congress at this time.
Remember, FTPR digital TV every week on Facebook and YouTube followed by the podcast on Friday morning and the new website FAIRtax Guys anytime.  Please watch, listen and tell everyone you know about FAIRtax Power Radio.  The FAIRtax: Once You Understand It, You’ll Demand It!
American's Big Solution - The FAIRtax Primer America Needs
Hard to believe but there still are people who have not heard of The FAIRtax.  For those people, America’s Big Solution provides a starting point in their study The FAIRtax and is meant for people of any age.  And you can download it to your tablet or smartphone right now.  It’s also available in print form.  See below.
Do you know someone who would like an introduction to The FAIRtax and would prefer to read about it in a booklet rather than search online for Tweets, Posts and Shares?  If so, America’s Big Solution is their best choice.
America’s Big Solution is an introduction to The FAIRtax written by Terry Tibbetts, author of A Spartan Game: The Life and Loss of Don Holleder, with help from Ron Maiellaro, President The Florida FAIRtax Educational Association.  You can buy an electronic version of ABS as follows:  AMERICA’S BIG SOLUTION is available for only $2.99 for the Amazon Kindle, the Barnes & Noble Nook and Apple iOS.
You can purchase a print copy at the same Amazon link above for $9.25.  Regardless of whether you choose the electronic format or the print format, you’ll find AMERICA’S BIG SOLUTION will give someone the boost they need to begin their study of The FAIRtax and the suggested resources to learn more. Buy AMERICA’S BIG SOLUTION now!
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Americans for Fair Taxation® is a 501(c)(4) non-profit, non-partisan grassroots organization solely dedicated to replacing the current income tax system with a fair, simple and transparent national consumption tax – the FAIRtax® Plan. We rely entirely on contributions from concerned citizens like you who want a tax system that will generate jobs and stimulate the economy. Welcome to the FAIRtax team!